The United States and Canada are big trading partners, in agriculture and beyond, and this is a relationship that benefits both countries. For U.S. dairy products, however, the path into Canada is not without roadblocks.

When the United States-Mexico-Canada (USMCA) Agreement was put into place in early 2020, the purpose was to “support mutually beneficial trade leading to freer markets, fairer trade, and robust economic growth in North America,” according to the Office of the Unites States Trade Representative. Unfortunately, in the years since then, the U.S. has had to fight for a fair market when it comes to dairy trade with its neighbor to the north.

The U.S. won an earlier claim taken up by the trade agreement’s dispute panel, challenging Canada’s tariff-rate quota (TRQ) allocation system. Under USMCA, Canada had agreed to open its market to U.S. dairy products, providing access up to 3.6% of its annual dairy market.

What happened, though, is that most of the quotas have been reserved for inputs of raw milk by Canadian processors, preventing food service providers and retailers from importing higher-valued dairy products from the U.S. This did not allow the open market access promised in the agreement.

Changes were made to the TRQ, but the U.S. filed another claim this year, contending that Canada was still not acting in line with what was agreed upon. This time, in a two-to-one vote, the panel sided with Canada. Leaders in Canada are, of course, pleased with the decision, but the outcome of the three-person panel’s decision was met with disappointment by the U.S. dairy industry.

As sellers of milk and other dairy products, the U.S. is not asking for Canada to move mountains. We simply want the trade terms outlined in the USMCA to be followed. If standards are not upheld in this instance, it could lead to a slippery slope and weaken the agreement, damaging the important export relationship between the two countries.

Although the outcome of the claim was disappointing, credit should be given to U.S. Trade Representative Katherine Tai for her strong commitment to enforce the rules laid out in the USMCA. We encourage Representative Tai and other dairy leaders to continue this pursuit so American farmers and processors can realize the market opportunities outlined in the agreement.